HOME DEPARTMENT

Accession State Nationals (Transitional Arrangements)

Des Browne: I am today publishing early information on the United Kingdom's transitional arrangements for workers from the new European member states in the first two months after accession on 1 May.
	Management information from the worker registration scheme shows that the majority of those registering were in the country before European Union (EU) enlargement on 1 May, and that the predicted dramatic increase of new arrivals has not materialised. This is consistent with previous enlargements, and with the experiences of our European neighbours, including Ireland and Sweden who have opened their labour markets to new EU citizens arriving legitimately. There is no evidence that accession workers are exploiting the benefits system.
	Today's figures prove that fears that the scheme would not pick up the full range of workers from accession countries were unfounded, as the advantages of being legitimate have persuaded people that registration is a sensible way forward. Today's figures also show that most media speculation about the numbers of new arrivals was groundless. Clearly it is too early to give a full and conclusive picture—as the Government made clear at the time the transitional arrangements were announced. Full figures will be included in regular quarterly statistics bulletins, starting in November. These preliminary figures are being issued in the light of public interest and to accompany the figures, which the Office of National Statistics (ONS) are publishing today, on the total number of visitors from the accession states.
	There were just over 24,000 applicants to the worker registration scheme during May and June. Of these, at least 14,400 (over 60 per cent.) were already in the UK before 1 May, and just over 8,000 were new arrivals. The worker registration scheme has given those nationals of the accession states who were in the country before 1 May—including those who may have been working illegally—the chance to legitimise their status and to contribute formally to the UK's economy, as well as allowing us to monitor the participation of workers from accession states in the UK labour market. Early indications suggest that the numbers registering have peaked and are beginning to fall back: figures for the last two weeks in June are 25 per cent. below those for late May and early June.
	It is important to note that these figures do not indicate levels of permanent migration from the new member states to the UK. It is too early to say at this stage how many of those coming will stay in the longer term. Experience of previous EU enlargements suggests that many of those registering to work will be here for short periods only, before returning home. Since May 1 there has been a good deal of anecdotal evidence, reported more widely abroad than in the UK, of job-seekers from the accession states returning home after brief periods of work or unsuccessful attempts to find work.
	Our monitoring arrangements also show that negligible numbers of accession nationals have tried to claim state support since 1 May. Around 240 claims have been made for income support and job seeker's allowance, of which all but six have been refused immediately: the remainder are still under consideration. Our evidence suggests that the vast majority of those applying for state support were here before 1 May.
	The figures that ONS are publishing today, based on the international passenger survey, show how citizens from the new EU are exercising their new rights to free movement. These new EU citizens have the right to travel freely across borders throughout the EU, regardless of any restrictions which some member states have placed on their right to work once they get there. Accordingly the 20 per cent. increase on last year's UK entry figures for May is to be expected. The ONS data show that many are coming here for short periods of time as visitors on business or on holiday—boosting our £11.9 billion a year tourism industry and local economies.
	The remainder of this statement gives further detail from the worker registration scheme and the numbers of people claiming benefits and housing. Some 19,946 applications to the worker registration scheme have been approved (92 per cent.), 6 per cent. were withdrawn and 2 per cent. were rejected. Our data show that 59 per cent. of those who registered with the worker registration scheme are from Poland, 17 per cent. are Lithuanian and 8 per cent. Slovakian. The overwhelming majority are young (83 per cent. are aged between 18 and 34), and single (94 per cent. have no dependants). The gender split is even (52 per cent. males to 48 per cent. females), and relatively few registered workers are students (9 per cent.).
	There is already early evidence that accession state nationals are playing an important part in the UK labour market. Since 1 May, we estimate that registered workers are contributing over £4 million a week to UK GDP and paying over £0.5 million a week in tax and national insurance. The majority are filling low to medium skilled jobs in London, Anglia, Central England and the South East. Almost all registered workers (96 per cent.) are working full time and some of those working part time have more than one job.
	As expected, many applicants are employed predominantly in sectors where there are large number of vacancies, and in many cases, recruitment difficulties. Data from the ONS for April 2004 showed that employers reported 181,000 vacancies in the distribution, hotels and restaurant sectors (well over a quarter of all vacancies recorded by the ONS survey). Data from the worker registration scheme show that the majority of registered workers are employed in hospitality and catering (6,523 workers, i.e. 34 per cent.), administration, business and management (3,153 workers, 17 per cent.), and agriculture (3,131 workers, 17 per cent.). We have reduced the quotas for the seasonal agricultural workers scheme and the sectors based scheme to take account of the impact of EU enlargement.
	The latest figures for the quarter immediately prior to EU enlargement show the UK labour market performing strongly. The economy is thriving: unemployment is down and employment is up. Employers and our public services are benefiting from a larger and more flexible labour pool, including skilled workers. Our data show that highly skilled workers are amongst those registering, for example there were 61 accountants, 53 nurses, 25 teachers and four lawyers authorised to work in the UK in May and June.
	Some 98 per cent of the national insurance numbers allocated to nationals of the accession states were for employment purposes, and fewer than 2 per cent. for benefit purposes.
	Accession country nationals who are in employment are eligible for tax credit and child benefit in the same way that any other EU nationals are, though very few have chosen to apply. Since 1 May, only 190 claims by accession state nationals for child benefit were approved. This compares with a total child benefit recipient population of approximately 7 million. Some 55 per cent. of applicants have provided information about their arrival date in the UK—of those 99 per cent. were in the UK before 1 May.
	The number of accession country nationals applying for homelessness assistance was also very low (102), and the majority of these (79 per cent.) were refused. All 21 of those found eligible were in the UK before the 1 May. Two local authority houses have been let to accession nationals since 1 May, representing less than 1 per cent. of the total average monthly lettings. Again, both households concerned were in the UK before 1 May.
	Data for the period July—September 2004 will be released in November.

EDUCATION AND SKILLS

Skills Strategy (Progress Report)

Ivan Lewis: In July 2003, the Government launched the national skills strategy, "21st Century Skills". The skills strategy is primarily a strategy for England, reflecting the devolution of responsibility for education and training to Scotland, Wales and Northern Ireland.
	The strategy's aim is to ensure that employers have the right skills to support the success of their businesses, and individuals have the skills they need to be both employable and personally fulfilled. Significant progress has been made in the first year of the strategy and today we are holding a key conference and the skills alliance is publishing a progress report to set out the successes to date and the challenges for the year ahead. There is now a real momentum for change, and a strong sense of shared purpose and enthusiasm, and I would like to make everyone aware of the following achievements.
	The skills alliance has brought together key partners with an interest in skills and productivity—Department for Education and Skills, Department for Trade and Industry, Department for Work and Pensions, Treasury, the CBI, the TUC, Small Business Council and the key delivery organisations led by the Learning and Skills Council. The skills alliance's role is to oversee effective implementation of the strategy and, today, has published its first annual report on progress.
	The skills strategy emphasised the need to move away from a supply driven education and training system towards a demand-led approach. We are driving this forward by:
	improving our understanding of employers' skills needs and their contribution to raising productivity;
	working with employers to ensure that the skills of their employees are effectively deployed to support business development; and
	ensuring that skills demand drives the design of training programmes and qualifications.
	The "Success for All" reform strategy, launched in November 2002, has been a key factor in raising standards, improving quality, and ensuring that colleges and post-16 providers become more flexible and responsive to employers' needs. I am very pleased with the way in which the further education sector is embracing these reforms and that standards and responsiveness are improving.
	During the year, colleges and other training providers have successfully continued to expand the existing flow of people with skills, training and qualifications, thus meeting the needs so far of individuals and of employers, including:
	Basic Skills—200,000 learners achieved at least one Skills for Life qualification this year. Since 2001, 2.3 million learners have taken up 4.6 million Skills for Life learning opportunities.
	Level 2—260,000 more adults in the workforce achieved qualifications at least to full level 2 1 at the end of 2003 compared to autumn 2002. The proportion of adults in the workforce qualified to Level 2 is now 71 per cent. 2
	Apprenticeships—246,000 16–24 year olds were enrolled by the end of March 2004. There have been over 1 million entrants to the programme so far.
	Foundation degrees—currently 24,500 students are enrolled on foundation degree courses, with employers involved in both the design and delivery.
	Overall flow of qualifications—nearly 3 million qualifications were achieved by adults in 2002–03.
	Other progress on the key areas within the strategy includes:
	For employers—there are over 60,000 employees on ETP through 10,000 employers, 18 sector skills councils, better business support, in particular for SMEs, and new apprenticeship family launched.
	1 A full level 2 refers to any qualification equivalent in standard and breadth to 5 GCSEs at A*–C or a national vocational qualification at level 2.
	2 Labour force survey, Winter 2003–04.
	For individuals—over 2,200 low skilled individuals benefiting from financial help with adult learning grant pilots, we are about to begin phased introduction of new level 2 entitlement in package of support in NE and SE, fewer adults without a full level 2, better IAG all over the country with reformed service standards.
	On qualifications—the work on reform of qualification system for adults will be set out at the skills strategy one year on event, Tomlinson proposals for 14–19, new qualifications to meet employer need.
	With colleges and training providers—we continue to build on success for all reform. Strategic area reviews underway, new LSC business cycle, plan led funding, upwards trend in college success rates, we are about to consult on reform of fees and funding.
	Through partnerships—new skills alliance and regional skills partnerships, NEP report to drive welfare to workforce development agenda including through new deal for skills, Government leading by example and addressing skills issues in all Departments bodies.
	These achievements represent significant progress during the year. We have been heartened by the widespread support that the strategy has received, the recognition that we have to get the implementation right if we are to achieve our national economic and social objectives, and the determination shown by organisations and individuals across the board to play their full part.
	However, there is much more to do, and it will require sustained commitment over a period of years to address the deep-seated barriers to skills investment, and so achieve our economic and social goals.
	Copies of the Skills Alliance: "Skills Strategy Progress Report"; "Skills Strategy Progress Report Technical Supplement On Underlying Data and Evidence"; "Government Meeting Its Responsibilities"; and the "Skills for Life Annual Review 2003–2004" have been placed in the Library and are available in the Vote and printed paper offices.

CONSTITUTIONAL AFFAIRS

Legal Services Ombudsman

David Lammy: The legal services ombudsman has today published the 13th Annual Report and copies have been placed in the Libraries of both Houses.

TRANSPORT

Regional Air Services Consultation

Tony McNulty: I would like to announce that the DfT's consultation on the protection of regional air services to London is being launched today.
	The UK Government are consulting on criteria for the implementation of policy announced in the "Future of Air Transport" White Paper in December. The Government are committed to clarifying the circumstances in which it is appropriate to intervene to guarantee a minimum level of air services on existing routes to London from UK regional airports. The consultation will provide a strong basis for the next stage of policy development. The consultation closes on 8 October 2004.
	The consultation document has been placed in the Libraries of both Houses and is also available on the Department for Transport's web site.

TRADE AND INDUSTRY

UK Inward Investment 2003–04 Report

Patricia Hewitt: With my right hon. Friend, the Secretary of State for Foreign and Commonwealth Affairs, I am pleased to inform the House that the UK remains number one in Europe for inward investment.
	UK Trade and Investment announced today, at its launch of the UK Inward Investment 2003–04 Report, that there were 811 direct investments in the UK by foreign owned companies between 1 April 2003 and 31 March 2004. This is an increase of 14 per cent. on the year before and confirms the UK's position as the top investment location in Europe. Total jobs figures were up 8 per cent. to 59,217 of which 25,463 were new jobs (down 26 per cent. on the previous year) and 33,754 were safeguarded jobs (up 41 per cent. on 2002–03).
	This performance reflects the confidence that companies around the world continue to show in the business climate in the UK. The number of new projects has increased by 8 per cent. from 314 in 2002–03 to 339 in 2003–04 while expansions by existing investors increased by 18 per cent. from 234 in 2002–03 to 285 in 2003–04.
	The competition is fierce. But we will not allow our position as market leader in Europe to make us complacent. UKTI will further strengthen and sharpen its operations in priority markets and the Government will continue to ensure that the UK provides economic growth and stability and an innovative climate to attract investment.
	I am arranging for a copy of the UK Inward Investment 2003–04 Report to be placed in the Library of the House.